South Bay Blogs

It’s that time of the year again… speculations abound for the coming year’s housing challenges and home prices.

Yahoo News posted Reuters’ report on a record drop in home prices nationwide, predicting that 2008 will continue to see home prices but 2009 may see a rebound. Washington Times looked at who’s to blame in the current housing debacle, comparing this cycle of housing bust with previous busts, and suggesting that “some combination of easy money, loose lending, greed and fraud” turned a housing boom into a bubble. Read the rest of this entry →

Wall Street Journal’s Informed Reader blog recently reported on a research citing that homeowners hurt the economy because homeowners are less mobile than renters and therefore are less willing to leave when local economy takes a dive. This lack of mobility exacerbates unemployment issues and hinders new development with zoning rules. While homeowners are more likely to invest in their communities and improve their neighborhoods, these benefits may not offset the drawbacks.

We got an email blast from Countrywide’s President, and it made me wonder whether Countrywide is worried about its customers leaving in droves due to recent concerns about the company’s wellbeing:

Dear Countrywide Homeowner,

As the mortgage and housing industry goes through unprecedented changes, Countrywide has been taking swift steps to help ensure that our customers won’t be impacted – and that we maintain our position as America’s #1 home loan lender.

With millions of current customers, no one is more committed to the dream of homeownership than Countrywide. And we continue to place an enormous value on customers like you.

As your home financing partner, we pledge to:
•Make sure you always know your mortgage options, and provide you with the information you need to make the best decisions.
•Tell you about opportunities to improve your home financing position, such as lowering your rate or payments.
•Make sure the loan process is always simple, honest, and straightforward, and that you know all terms and fees upfront.

I want to thank you for letting us serve your home financing needs, and assure you that your continued satisfaction will always remain our #1 priority.

Sincerely,
Andrew Gissinger III
President and Chief Operating Officer
Countrywide Home Loans, Inc.

New York Times today covered a story on the myriad of fees that are hitting people who can afford it least – people who are struggling to pay their increasing mortgage or are foreclosing on their homes. In Dubious Fees Hit Borrowers in Foreclosures, 7.5% of CountryWide’s service revenues came from late fees – almost $300 million worth:

But these are not the only charges borrowers face. Others include $145 in something called “demand fees,” $137 in overnight delivery fees, fax fees of $50 and payoff statement charges of $60. Property inspection fees can be levied every month or so, and fees can be imposed every two months to cover assessments of a home’s worth.

It goes to show that when revenues are being squeezed in one area (tougher lending environment), lenders will find other ways to make money, and in situations where regulation is lax, some of these lenders’ business practices can make worse a home owner’s nightmare.

From Reuters: “Sales of houses and condominiums in the most populous Southern California counties fell 29.9 percent from the previous month and 48.5 percent from a year earlier, DataQuick Information Systems said on Tuesday.

The report covers the counties of Los Angeles, Orange, San Diego, Riverside, San Bernardino and Ventura and showed a total of 12,455 new and existing homes and condos sold in September, the lowest since the company began recording the data in 1988.”